Goldman To Launch A Private REIT Targeting At JPY 300 Billion

According to a Bloomberg report, Goldman Sachs Group Inc. plans to expand its new private real estate investment trust to as much as 300 billion yen ($3.7 billion) to buy Japanese properties, as it foresees a turnaround in prices. GS aims to launch a private REIT, a product recently introduced in Japan, with the initial target of 30 billion yen in this August. Mitsubishi Estate Co., Mitsui Fudosan Co. and Nomura Real Estate Holdings Inc. have set up private REITs in the past 12 months. According to a Hong Kong-based S&P professional cited in the Bloomberg article, “Japan is in a different cycle compared with other markets in Asia-Pacific.The other markets are coming off from a cyclical top so they are well under way for correction. Japan has been in correction for some time now, so it’s on its way for a recovery.”

J-REITs account for 8.3 trillion yen of Japan’s 23.2 trillion real estate investment market, while private equity real estate funds represents the rest ( =15 trillion yen). The size of private REIT market, however, is estimated to be less than $2 billion.


Japan’s $3.36 trillion in pension money is the world’s second-largest after the US. According to Towers Watson, Japanese pensions have 31 percent of investments in equities and 59 percent in bonds, with only 6 percent in alternative assets.